United CEO says cuts possible if bookings stay weak CHICAGO (AP) =97 United Airlines CEO Glenn Tilton said Friday the carrier=20 could reduce its flying schedule even before an Iraqi conflict begins if=20 the public's war jitters continue to limit bookings. Such a move would=20 entail more layoffs, Tilton indicated in a message to employees.=20 "Unfortunately, we are already seeing a drop-off in bookings and we are=20 prepared to move quickly should it become necessary, even prior to actual=20 hostilities," he said on the company hot line. United spokesman Joe Hopkins= =20 confirmed that such actions would entail flight cutbacks and layoffs, as=20 the bankrupt airline's war contingency plans call for. "There are no=20 numbers or dates, but it's something we're keeping an eye on," Hopkins=20 said. United, which operates about 1,700 daily flights and has 72,500=20 employees, already has cut about a quarter of its flying capacity and work= =20 force in the past 18 months. But the world's No. 2 carrier is under=20 pressure from its lenders to show swift progress in bankruptcy or risk=20 losing its interim financing. Already mired in the industry's worst-ever=20 downturn, United said at a presentation to its creditors in Chicago this=20 week that lower revenues and rising jet fuel costs have hurt its financial= =20 performance more than expected recently. Chief financial officer Jake Brace said customers are declining to book=20 international trips very far into the future as the threat of war looms. Tilton, discussing contingency plans outlined by United earlier, said the=20 airline would reduce its schedule quickly in the event of "impact from war"= =20 =97 possibly by an initial 10 percent to 12 percent. Additional employee=20 furloughs would occur. It also would ask its bank lenders to revise the=20 timetable under which it must return to profitability, so it wouldn't lose= =20 the financing that's keeping it flying during bankruptcy. Meanwhile, an=20 airline industry group representing United and other carriers is lobbying=20 the government for tax relief it says will be needed to avoid near-collapse= =20 if the United States goes to war against Iraq. "Our hope is that these=20 steps will enable us to weather the war's impact," Tilton said. "If not,=20 then we would potentially have to seek additional temporary reductions of=20 pay =97 but only as a last measure, only as a last recourse." United=20 employees already took interim wage cuts totaling $70 million a month in=20 January and are in negotiations with the company over its effort to slash=20 $2.56 billion in annual labor costs through 2008. The airline says it must= =20 secure long-term concessions by May 1, when the temporary cuts expire, in=20 order to meet its lenders' strict requirements. United intends to ask Bankruptcy Judge Eugene Wedoff to void existing labor= =20 contracts if negotiated agreements are not reached by Monday, which the=20 company and numerous union leaders have indicated won't happen. The=20 contracts wouldn't be nullified until May under United's proposal, giving=20 labor and management another 45 days from that date to settle on terms. Standard & Poor's analyst Philip Baggaley said in a note to investors=20 Friday that United appears to have reached its lenders' first required=20 financial benchmark, based on results through February. But he said United= =20 could violate its second covenant test, measuring results through the end=20 of March. If that happens, its bankruptcy lenders could either waive the=20 violations or ask United for immediate repayment of $700 million in loans,= =20 potentially causing the airline to cease operations and liquidate. Industry= =20 experts consider that an unlikely immediate prospect, however. *************************************************** The owner of Roger's Trinbago Site/TnTisland.com Roj (Roger James) escape email mailto:ejames@xxxxxxxxx Trinbago site: www.tntisland.com Carib Brass Ctn site www.tntisland.com/caribbeanbrassconnection/ Steel Expressions www.mts.net/~ejames/se/ Site of the Week: http://www.thehummingbirdonline.com TnT Webdirectory: http://search.co.tt *********************************************************